Annual Integrated Report 2019

Market disruptors Increasingly tech focused delivery companies are focusing on the foodservice market, initially in the consumer delivery space but with an eye on the foodservice wholesale model, threatening disruption. Competition from these disruptive market entrants have threatened to take market share. How we respond Bidcorp remains committed to our core foodservice business, to maintaining the world-class service and efficiency ethic, which our customers have come to expect. We have seen significant success in the adoption of our value-over-volume strategy, focusing on the high margin, high service customer. We remain vigilant watching market trends and are agile enough to implement timely interventions, to respond to our customers changing expectations and needs. We are focused on what we are good at: namely, ensuring a shared passion among our stakeholders about food, service and easy to use, intuitive technological solutions to develop a mutually beneficial customer relationship. Last-mile differentiator Differentiation in the foodservice industry is achieved through ongoing close contact with customers, positioning competitive pricing, with the ability to provide a full basket of products and consistently delivering promptly and accurately. How we respond Our success in the roll out of our metro strategy is as a result of the establishment of conveniently located warehousing solutions, specifically enabling a faster, better last-mile quick turnaround response to customer orders. Through the implementation and effective use of our ecommerce solutions to take and anticipate customer orders; the offer of regular and quick turnaround deliveries, and a broad range of high-quality competitively priced products, Bidfood aims to differentiate themselves on the last-mile service excellence. What it may mean to us • • Competitive advantage in the market • • Fit-for-purpose warehouses • • Responsive, agile and flexible delivery cycles What it may mean to us • • Margin erosion from competition • • Loss of market share • • Loss of supply chain buying power Consumers’ changing eating habits Changes in consumer eating habits such as a decline in consuming food in restaurants, strong preferences for organic and vegan product offerings, or shifts in non-customer restaurant preferences could reduce demand for the current product range and impose significant changes on the supply chain. How we respond We remain close to our customers’ requirements arising from changes in consumer eating habits. Our market-leading ecommerce platform provides a comprehensive database, tracking trends in the overall foodservice environment and in particular changes in consumer preferences. These insights allow us to proactively adjust and realign our go-to-market strategy and product focus. This bespoke data insight has enabled Bidfood to provide customers with substitute product suggestions, product usage reports, menu-planning advice and food safety training, to proactively deal with the changing consumer preference landscape. What it may mean to us • • Loss of market share • • Obsolete stock and significant write offs • • Product range procurement adjustments Customer service excellence Own brand Chef’s Classique, Bidfood South Africa. Bid Corporation Limited Annual integrated report 2019 / 13 This is Bidcorp